TPT September 2012

Global Marketplace

www.read-tpt.com

September 2012

Oil & Gas

The roster of bidders eager to

work the Afghan-Tajik Basin

suggests rapid development of

Afghanistan’s oil and gas sector

Seven energy companies have joined Exxon Mobil Corp, of

the US, in seeking to bid for the right to explore for oil and gas

in the Afghan-Tajik Basin in northern Afghanistan, according

to a release issued 4 July by that country’s Ministry of Mines.

The other firms identified as having submitted “expressions

of interest” are: Dubai-based Dragon Oil Plc; Kuwait Energy

Co; India’s ONGC Videsh Ltd; Petra Energia SA, of Brazil;

Pakistan Petroleum Ltd; PTT Exploration & Production, of

Thailand; and Turkey’s TPAO.

Reporting from Houston in the

Wall Street Journal

, Tom

Fowler said a formal expression of interest gives a company

access to seismic and well log data in and around the area

that is being let out for bidding in northern Afghanistan, near

the city of Mazari-Sharif. Bids were to be collected in the fall.

The US Geological Survey estimates the reserves in the

Afghan-Tajik Basin blocks at up to one billion barrels of oil.

“Building on the success of last year’s tender in the Amu

Darya Basin, we believe this tender magnifies the progress

we are making,” Minister of Mines Wahidullah Shahrani

said in a statement that referred to a bid offering made

last year. The bidding was won by a joint venture between

China National Petroleum Corp and a local Afghan partner.

The Ministry of Mines said that the company, which began

production in Amu Darya on 24 June, is expected to produce

at least 150,000 barrels of oil in 2012.

Mr Fowler’s report indicates that the authorities in Afghanistan

are particular about which energy firms will be invited to

work the Afghan-Tajik Basin. Of 20 companies that sought

participation in the bidding round, 12 were disqualified. The

Ministry of Mines said they lacked the required financial

resources or technical expertise, or did not submit their

information by the 30 June deadline, or submitted incomplete

information.

‘Idle iron’

Something very new in the

ecology movement: a vigorous

effort to save an abandoned

Gulf of Mexico oil platform from

demolition

Thirty years after it was built and months after it was

decommissioned, an oil platform set to be demolished under

US Interior Department rules governing non-producing

ocean structures has acquired some unusual defenders. The

platform, High Island 389-A – one of about 650 such oil and

gas industry relics known as idle iron – rises out of the Gulf

of Mexico about 100 miles southeast of Galveston, Texas. A

visitor, Melissa Gaskill, might almost be rendering the scene

for readers of the journal

Nature

“Below the surface, corals, sea fans and sponges cover its

maze of pipes. Schools of jack and snapper, solitary grouper

and barracuda circle in its shadows. Dive boats periodically

stop at the enormous structure, where dolphins, sea turtles

and sharks are often spotted.”

In fact, her description of the lush ecosystem that has grown

around High Island 389-A appeared in the

International Herald

Tribune,

and Ms Gaskill’s tranquil tone changed quickly. Much

of the marine life on or around the structure will likely die with

its planned demolition, either from the explosions to separate

the platform from its supports or when it is toppled or towed to

shore and recycled as scrap metal.

To save both platform and ecosystem from this fate, an

unusual collection of allies is hoping to convert High Island

and many similar structures into protected reefs. (“In Its First

Life, an Oil Platform; in Its Next, a Reef?”, 17 June)

According to estimates by government scientists cited by the

Herald Tribune

, a typical four-legged platform becomes the

equivalent of two to three acres of habitat. “These structures

attract marine life that normally wouldn’t use the area,” said

Greg Stuntz, chairman of ocean and fisheries health at the

Hartz Research Institute for Gulf of Mexico Studies at Texas

A&M University (Corpus Christi). “Much is growing on them,

from corals up to marine mammals.”

Somewhat ironically, the removal of High Island 389-A was

itself dictated on environmental grounds. The platform, built

in 1981, falls within the 56-square-mile Flower Garden Banks

National Marine Sanctuary, one of 14 federally designated

underwater areas protected by the National Oceanic and

Atmospheric Administration’s Office of National Marine

Sanctuaries – and the only such area in the Gulf. The Interior

Department gives owners of a non-producing platform within

the preserve one to five years to remove it, depending on the

terms of the drilling lease and the location of the structure.

High Island’s owner has until January to act.

tay of

execution

Efforts are under way to save the platform. Earlier this year,

W&T Offshore, the oil and gas acquisition and exploration

company that owns it, told GP Schmahl, superintendent of

the Flower Garden Banks sanctuary, that the company would

prefer to convert High Island to an artificial reef. If the plan is

approved, the structure would likely be dismantled to 85 feet

below the water surface, as required under a federal rigs-to-

reefs programme. (At the time that the

Herald Tribune

article

was published, W&T officials had not responded to requests

for comment.)

Ms Gaskill wrote that sanctuary officials said they were

“comfortable” with a partial removal, but were concerned over

liability and maintenance issues. In May, the Flower Garden

Banks advisory council voted unanimously to request a

moratorium on High Island’s removal until at least September

2013.